JOLT Digest

U.S. appeals court affirms district court decision that a download is not a performance under the Copyright Act
By Greg Tang – Edited by Ian C. Wildgoose Brown

United States v. Am. Soc’y of Composers, Authors & Publishers, No. 09-0539 (2d Cir. September 28, 2010)
Opinion

On September 28, the United States Court of Appeals for the Second Circuit affirmed the ruling of the Southern District of New York that a digital download of a song does not constitute a public performance under section 106(4) of the Copyright Act. The court also vacated the district court’s assessment of fees for the blanket licenses that Yahoo! Inc. and RealNetworks Inc. sought from The American Society of Composers, Authors and Publishers (“ASCAP”), and remanded for further proceedings.

The holding in this case prevents ASCAP from “double-dipping” by receiving compensation for both copies and performances of its members’ musical works. It also provides much needed clarification on how license fees should be calculated for music streamed over the Internet.

JOLT Digest previously reported on the district court’s ruling that cell phone ringtones do not constitute public performances. BroadbandBreakfast.com and Bloomberg Businessweek each provide an overview of the case. The 1709 Blog and Internet Cases examine the court’s reasoning in detail. (more…)

Court Orders District Court to Reconsider Preliminary Injunction on “Catcher in the Rye” Sequel
By Katy Yang – Edited by Kassity Liu

Salinger v. Colting, No. 09-2878-cv (2d Cir. April 30, 2010)
Slip Opinion

The United States Court of Appeals for the Second Circuit vacated and remanded the judgment of the United States District Court for the Southern District of New York, which had granted Salinger’s motion for a preliminary injunction for copyright infringement and unfair competition.

The Second Circuit unanimously held that the Circuit standard for granting preliminary injunctions in copyright cases, applied by the District Court, was inconsistent with the four-factor test “historically employed by courts of equity,” set out in eBay, Inc. v. MercExchange, L.L.C., 547 U.S. 388, 390 (2006), which now replaces the original standard. Although eBay was about a permanent injunction for patent infringement, the Second Circuit also held that it “applies with equal force (a) to preliminary injunctions (b) that are issued for alleged copyright infringement.” In so holding, the court explained that eBay strongly suggests that its scope presumptively extends to injunctions in any context. The court also affirmed the district court’s conclusion that Salinger is likely to prevail on the merits due to substantial similarity between the two works and the likely failure of Colting’s fair use defense. Finally, because the Circuit’s original standard for granting preliminary injunctions in copyright cases has been changed to the eBay standard, the court found it unnecessary to reach the constitutional issue of whether the Circuit’s original standard is an unconstitutional prior restraint on speech.

Bloomberg Businessweek provides an overview of the case and features a thorough analysis of the decision. The Am Law Daily and the New York Times summarize some of the legal issues in the decision. Stanford Law School’s Center for Internet and Society submitted an amicus brief arguing that courts should consider more factors before granting injunctions, which can be found here. (more…)

Second Circuit Affirms Dismissal of Tiffany’s Trademark Infringement Claim Against eBay
By Dmitriy Tishyevich – Edited by Jad Mills

Tiffany Inc. v. eBay Inc., Case No. 08-3947 (2d Cir., Apr. 1, 2010)
Slip Opinion

On April 1, the Second Circuit largely affirmed the holdings of the district court in the Southern District of New York. The court concluded that despite the evidence that eBay had general knowledge that some of its customers had used its website to sell counterfeit Tiffany merchandise, eBay itself could not be held liable for direct or contributory trademark infringement or for trademark dilution. It remanded the case, however, to determine whether eBay could be held liable for false advertising.

Eric Goldman, who had previously commented on the district court opinion, provides a summary of the Second Circuit’s decision.  Larry Downes for the Stanford Law School Center for Internet and Society views the decision “a matter of economic necessity,” arguing that placing the burden on online marketplaces rather than on manufacturers “would effectively mean the end of eBay and sites like it.” Rebecca Tushnet comments on the opinion, focusing on the false advertising holding. Ron Coleman of the Likelihood of Confusion blog provides some additional commentary and criticism.

(more…)

Constitutional Challenge to Gene Patents Survives Motion to Dismiss

By Davis Doherty – Edited by Jad Mills
Assn. for Molecular Pathology, et al. v. USPTO, et al., Case no. 09-CV-4514 (S.D.N.Y. Nov. 2, 2009)
Slip Opinion (hosted by Patent Baristas)

The United States District Court for the Southern District of New York denied defendants’ motion to dismiss plaintiffs’ claim that patents on a human gene violate the First Amendment and Article I of the Constitution for jurisdictional issues, lack of standing, and failure to state a claim.

District Judge Sweet found that the plaintiffs’ constitutional claims challenging the validity of Myriad Genetics’ gene patents provided subject matter jurisdiction and standing to sue the United States Patent and Trademark Office because of the lack of available statutory remedies.  The plaintiffs claim that Myriad’s patents are inappropriate because they cover “products of nature”, and seek invalidation of the patents under the Constitution of the United States. Judge Sweet held that these claims met the stricter pleading standards recently announced in Ashcroft v. Iqbal, 129 S.Ct. 1937 (2009).  In so holding, the court noted the “novel circumstances presented by this action against the USPTO”: The Patent and Trade Office is generally immune from suit due to the availability of statutory remedies for claims arising from patents. Such remedies do not provide for constitutional claims.

Ars Technica provides a brief overview of the case.  The ACLU, who represents the plaintiffs, writes in support of the decision.  Patent Baristas put forward a more skeptical view of the plaintiffs’ prospects. Patent Docs features a longer analysis of the decision. (more…)